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Gala2k [10]
3 years ago
6

A stock with a current market price of $50 and a strike price of $45 has an associated put option priced at $3.50. This put has

an intrinsic value of ______ and a time value of _____.
PLEASE SHOW ALL STEPS, THANK YOU!

A.) $5; $3.50
B.) $3.50; $5
C.) $3.50; $0
D.) $0; $3.50
Business
1 answer:
Rashid [163]3 years ago
6 0

Answer:

The answer is D

Explanation:

Intrinsic value can be found by simply using the following formula

Put intrinsic value = Strike Price - Current selling price

this gives,

PIV = $45 - $50 = $-5

A put intrinsic value cannot be vegetative as it can be exercised right now at the current price. Thus it is interpreted as 0.

Time value is calculated as follows

Time Value = Option Price - Intrinsic Value

This gives   TV = $3.5 - $0 = $3.5

Hope this helps.

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the common stock of salazar insurance pays a constant annual dividend of $4.80 per share. what is one share of this stock worth
kotegsom [21]

Market Price =$36.09,is one share of this stock worth at a discount rate of 13.3 percent.

<h3>Common stock: What does that mean?</h3>

A security that symbolizes ownership in a firm is called common stock. Common stock owners choose the executive board and cast ballots for corporate rules. This kind of stock ownership frequently offers better long-term rates of return. Common stock is not subject to either assets or liabilities.

<h3>How are shares & common stock different from one another?</h3>

Definition: The term "stock" refers to the holder's interest in one or more businesses. A single share of interest in a firm is referred to as a "share" in contrast. For instance, if X has stock investments, X may have a collection of shares from various companies.

<h3>Briefing:</h3>

Market price = dividends per share

P0 = $4.80/.133

P0 = $36.09

Market Price =$36.09

To know more about common stock visit:

brainly.com/question/13762106

#SPJ4

5 0
1 year ago
A two-year college is often the best choice for students who need additional training or time to explore career options.
coldgirl [10]
True I think okay don't judge me:(
5 0
3 years ago
Madrid Company plans to issue 9% bonds with a par value of $5,300,000. The company sells $4,770,000 of the bonds at par on Janua
ASHA 777 [7]

Answer and Explanation:

The journal entry are as follows

1. Interest expense $214,650

       To Cash $214,650

(Being the first interest payment is recorded)

The computation is shown below

= $4,770,000 × 9%  × 6 months ÷ 12 months

= $214,650

For recording this we debited the interest expense as it increased the expenses while on the other hand the cash is paid which reduced the cash balance so it is credited

2. Cash $530,000

      To Bond payable $530,000

(Being the cash sale of bond is recorded)

For recording this we debited the cash as cash is received that increased the cash balance and at the same time we credited the bond payable

5 0
3 years ago
Emma is the labor union negotiator. Today, she is meeting with management to discuss the new five-year contract, including wages
Sergio [31]

Answer:

Distributive bargaining

Explanation:

Distributive bargaining can be defined as a type of bargaining system/strategy in which one party gains only if the other party loses.

Distributive bargaining is mostly used when there is a negotiation that involves fixed resources e.g; money, assets, etc.

Distributive bargaining as a negotiation strategy does not aim to provide a win-win situation for all parties involved but that one party loses while the other gains considerably.

An example of distributive bargaining is a supermarket having a fixed price for an item. in that situation, you can't bargain and as such you either buy the item or leave the store.

That results in a win for the supermarket and a loss for you the buyer should yo choose to buy the item.

Cheers

5 0
3 years ago
Select two skills and two personal values that you feel you have to offer in the workplace. Discuss the importance of these skil
klemol [59]
For me the two personal values its to bring Sarcastic Humor to the work place and Value to make hard descisions. Why are these things inportant? Well because If you bring comedy it boosts moral in the office and the ability to make hard desicions is useful to get a higher postion in your job.
6 0
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